M&g Share Discussion Threads

[2wild] 14/3/2021 19:00

Shareholder Solvency II coverage ratio up from 176% to 182% last year. Net debt is a tiny fraction of £367 billion funds under management, at 2020 year end. World markets also well up over first 2 months of 2021. Not to mention there are now several very effective Vaccines being manufactured at a rate of hundreds of millions per month. All extremely vulnerable and all over 55s in UK, which prior to mass vaccinations accounted for over 99.5% of covid related deaths, will have been offered at least one jab by end of March.

Also bearing in mind MNG paying off and refinancing at ultra low rates over next few years, will boost earnings, due to interest bill reductions . I couldn't care less about MNG debt.

[whatja] 14/3/2021 15:52

The gearing was explained during the listing as fully covered by the capital run off from the annuities business.
Management said they were targeting a reduction from the 30% level, note this is comparable with others such as Aviva. Presumably there will be a pay down of debt as it matures from generated capital.

So yes debt is a little high, but covered and should not be an issue and is not an issue at the moment.

[arja] 14/3/2021 15:37

nice looking chart but very high gearing is a concern is it not ?

[spcecks] 14/3/2021 13:46

xtmnntr Thanks for sharing the article above much appreciated.

[spcecks] 14/3/2021 13:43

Also sold SLA after results and added more MNG ....also have AV.LGEN and PHNX which I’m happy with

[boozey] 14/3/2021 06:32

ianood, thanks much appreciated. Cassini good to see you here too. I did the same thing, sold my standard life after results, but have materially more MNG. MNG and Investec are my two main Asset Management holdings but weighted heavily to MNG. Also have some Jupiter which are proving to be like Standard Life but I haven't sold. Investec have a trading statement on Friday this coming week.

[ianood] 14/3/2021 01:02

Boozey - FYI it was in the Investors Chronicle

[cassini] 13/3/2021 23:03

Appropriately enough, I sold my holding in Standard Life Aberdeen after their results last week. If 5.5% is the best they can do, it doesn't bode well...

I didn't walk away empty-handed from SLA - I made 10% on my holding, which was acquired maybe mid-2020. Not a bad return, annualised.

I hold four times as much MNG as I did SLA so like to think I got my strategy mostly right ;0)

[boozey] 13/3/2021 18:56

Xtr - great post - thanks - where was that article published?

[xtrmntr] 13/3/2021 16:17

"Kick the dividend habit" this magazine recently implored shareholders, whether their goal is income or share price growth.The argument – that total return strategies work better over time – is backed by solid evidence, but ingrained preferences die hard. Be it a subtle distrust of companies' capital allocation plans or the bias for rental income that only a property-obsessed nation can sustain, UK shareholders like to feel the fruits of their risk-taking in cash lump sums, thanks.Dividend strategies for M&G (MNG) and Standard Life Aberdeen (SLA), clarified this week, provide useful insights into the market's views on capital returns and appropriate yields for two FTSE 100 insurer-cum-asset managers whose brands have seen better days.M&G, in its first of set of full-year results since its split from the higher-growth Prudential (PRU), surprised the market by doing what it already said it would: declare a stable or increasing dividend.In the event, the final pay-out climbed by 2.6 per cent, though had it held at last year's level, the pro-forma annual yield would have still stood at almost 9 per cent. As such, one suspects the heady market reaction to these numbers was less to do with the size of the distribution than the strength of the group's capital generation – shorthand for growth in capital above regulatory minima and therefore a useful proxy for income and balance sheet health.Though tangible signs of business growth were predictably elusive – excess capital from both the asset management and legacy Heritage life insurance arms were flat year-on-year – 2020 results will provide encouragement to those shareholders who believe equity can grow with or without reinvesting dividends. Indeed, a three-year target to generate £2.2bn in capital by the end of 2022 now looks beatable - especially after management joined Phoenix Group (PHNX) in lowering their longevity assumptions.The fact is, M&G's yield is so high because parts of its business are valued so cheaply. These results showed dividends are affordable alongside rising capital buffers and growth-oriented investments, such as the recent acquisition of wrap platform provider Ascentric.That deal helped to offset fund outflows elsewhere, including £12bn from retail investor mandates. This remains a perennial issue for the fixed income focused investment group, as it does for SLA, which sold its own closed-book life insurance division to Phoenix in 2018.The terms of that arrangement were tweaked ahead of full-year results, handing Phoenix the Standard Life brand and £115m in cash, in exchange for several complementary products to SLA's financial advisor platforms and a 10-year extension to a low-margin mandate to administer Phoenix's largely bond-based £172bn asset portfolio.In 2020, this was one of the few portions of the managed asset pile that held back net outflows. The higher-margin wealth management business, which accounted for £80m in fee based revenue, saw £1.1bn of gross inflows matched by redemptions; a further £25.9bn tranche from the lost Lloyds Banking Group mandate headed to Schroders (SDR) in the first half; while the institutional and wholesale arm – the source of almost two-thirds of fee-based revenues – saw net flows of just £0.3bn.The result was a 1.9 per cent dip in assets under administration, even after market movements. Together with lower margins across all sales channels, this weighed on revenues and adjusted pre-tax profits, given the largely fixed cost base.How does management turn this around? The answer – beat industry benchmarks and watch fund flows reverse over time – is easier said than done, particularly when managing more than half a trillion pounds' worth of client money.The outperformance of 68 per cent of total assets under management over a five-year time horizon is one source of hope. Yet it also feels less compelling when you note that key drivers of this record – fixed income, cash and alternatives – also attract some of the lowest fees.Chief executive Stephen Bird's decision to almost half the final dividend to 7.3p signals feel less like a sensible rebasing than a warning of further pain, and that consensus earnings forecasts of 17.4p per share for 2021 could prove overly optimistic. Sell.By contrast, though M&G's miserly rating reflects uncertain long-term prospects, we see much more security in its near-term capital return promises. Buy.

[gaffer73] 12/3/2021 19:22

Evening all, bought some of these this morning. Reading the comments below I can see how this appears ready for a pull back but a PE of 5/6 and divi of 8% tells me there's still plenty of upside, especially if they reach the 2.2b target by 2022.

[gary1966] 12/3/2021 15:43

Had spotted that gap going back a long time and that is my slight concern. However most gaps fill quite quickly on M&G and so on balance I have clearly decided that 204p will be closed first. As I said it will probably roar away now and if it does then I will be pleased for everyone.

GLA

[2wild] 12/3/2021 15:40

I think we are filling a massive super gap upto 252p. With a PE below 6 and yield above 8%, these are still a Bargain. Despite falling below 174p a few days later, have been buying the dips ever since I posted this around 6 weeks ago:

2wild 27 Jan '21 - 10:26 - 444 of 529  Edit
Added this morning at 181.95 and 180.19p. Expect they will declare a 2020 final dividend of 12.2p in about 6 weeks time. Giving a 10% yield on 18.3p full year. I imagine the share price will be nearer 250p by the ex dividend date.

[karv1] 12/3/2021 14:13

Good luck Gary1966 you rolled the dice, I hope it works out for you.
Ps On the other hand I do not want it to go down until after the dividend.
Then have an amazing recovery by April 6th.

[gbh2] 12/3/2021 14:00

It's hedge fund volume that tends to fill Gaps.

imo this simply doesn't have that type of investment profile.

[gary1966] 12/3/2021 13:13

Well for my sins, on my return today I have found that I have sold my holding at just over 224p and so rest assured they will probably rocket now. Reasoning is that M&G have had a really strong run over the last couple of weeks, tend to always fill gaps on the chart and there is now one at just over 204p and the RSI is elevated over 70. Definitely looking to re-enter on any pullback to increase my overall position.

GLA

[my retirement fund] 12/3/2021 13:08

Looking for £3.00

[woodhawk] 12/3/2021 10:17

...and well under-valued at less than 300p.

[thebutler] 12/3/2021 10:10

Great stock this

[flagon] 12/3/2021 09:55

(Alliance News) - The following London-listed shares received analyst recommendations Friday morning and Thursday:

JPMORGAN RAISES M&G PRICE TARGET TO 255 (231) PENCE - 'OVERWEIGHT'

[2wild] 11/3/2021 22:17

FWIW: Bank of America on Thursday upgraded M&G from neutral to buy and raised the price target from 209p to 242p.

[stevetmade1] 11/3/2021 14:47

Thanks Woodhawk.

[woodhawk] 11/3/2021 14:26

Ex-dvi 18 March (next week!) paid 28 April.

[stevetmade1] 11/3/2021 14:16

When is payment date for the dividend, anybody? tia.